Unemployment nears 2 million amid record redundancies

A record number of people are being made redundant in Britain as unemployment climbs towards two million, official figures show.

Job Centre: The jobs figures are released as a report is published claiming women will be hardest hit by the recessionPhoto: REUTERS

By Harry Wallop, Consumer Affairs Editor

1:29PM GMT 21 Jan 2009

There were 225,000 redundancies in the three months to the end of November, which is the highest level since the figure began being compiled in 1995.

Overall, when the number of people who found new jobs are taken account, unemployment increased by 131,000 during that period to hit 1.92 million. That is the highest level since 1997, the year Labour came to power.

Experts pointed out that because the figures do not include all the job losses since the end of November, not least the 27,000 jobs that have been axed at Woolworths, the number of people unemployed in Britain is already over 2 million in reality.

John McDonnell, Labour MP, said: "Unemployment today is over two million. This is a depression not just a recession, and the Government's measures have failed to protect people and preserve their jobs.

"A lack of planning and radical action makes it almost inevitable that unemployment will hit 3 million with the consequent human suffering."

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Employment minister Tony McNulty said the figures were "very disappointing" and predicted things would "get worse before they get better".

Experts expressed alarm at how fast redundancies were accelerating.

"This is a very rapid pace of job shedding," said Alan Clarke, an economist, at investment bank BNP Paribas.

"It is still very early days in this recession and there is plenty of bad news in the pipeline."

This week so far jobs have been cut or placed under threat by fashion house Burberry, TT Electronics, Bradford-based conveyancing firm Hammonds Support Systems, restaurant chain Fishworks and food manufacturer Vion.

The official figures showed that older workers were being hit harder than any other group of people by the wave of redundancies.

In the three months to November, those unemployed (for a spell of at least six months) increased by 29.8 per cent for those aged 50 plus, compared with an increase of 4.8 per cent for those aged between 25 and 49.

Gordon Lishman, director General of Age Concern, said: "The Government must take action if it is to avoid thousands of willing older workers becoming job-cut casualties who are permanently dependant on state support.

"Once unemployed those over fifty are also much less likely to be able to find new employment. Yet the current training and support provided to the unemployed, and further recent proposals from the Government, do not target older workers."

This week's unemployment number is the highest since the summer of 1997, when Labour took office.

Most economists believe that the unemployment level will climb towards about 2.8 million by the end of this year, before hitting 3 million in 2010. It has not been this high since 1993, in the dog days of the last recession.

The Ernst & Young Item Club, a forecasting house, predicts it will hit 3.4 million ultimately – the highest levels since the end of the Second World War.

Many, however, believe Britain will be cushioned from this dire scenario, because many eastern European immigrants will return home, freeing up many jobs.